What Is Market Positioning and Why Is It So Important?
Digital & Marketing Strategy

What Is Market Positioning and Why Is It So Important?


In the fierce battlefield of modern marketing, consumer perceptions of a brand or product count for everything. From establishing a solid first impression to (hopefully) leading a customer along the path to conversion, competitive positioning as a marketing strategy is one of the most powerful tools at any marketer’s disposal.

Marketing positioning is a relatively simple concept to understand, but it can be particularly difficult to master. Our guide will provide the clarity needed to thrive.

What Is Competitive Positioning as a Marketing Strategy?

Competitive position (or marketing position) is a term that relates to where a consumer would position your brand within the market. Therefore, it refers not only to the direct reaction to the brand but also, crucially, how it is perceived in contrast to the company’s competitors. 

The process of market positioning, then, is one that focuses on establishing a clear brand identity that encourages prospective clients to perceive your business in the desired manner. The message that your brand wants to express will be influenced by a host of features ranging from the industry and location to target markets and their financial power. 

There are several types of market positioning strategies that could be used depending on the individual attributes of the brand. They include:

1. Product benefits positioning

This is where the brand promotes distinct characteristics or features that offer a level of beneficial value that separates the company from its competitors. 

Good examples include any products that provide dual functions.

2. Product quality positioning

This is where the brand focuses on its style and luxury. The consumer will pay a higher price for the exclusivity and emotional response that an association to the brand can bring. 

The obvious example would be a car company like Ferrari.

3. Product pricing positioning

This is where the brand establishes itself as providing products that offer the same benefits as competing products but in a budget-friendly manner.

Manufacturers of food, clothing, and household goods may position themselves here.

4. Product application positioning

This is where the brand focuses on marketing a specific function or use for the product. It could mean using it in a certain situation or scenario.

A number of beauty brands will use this market positioning strategy.

5. Product superiority positioning

This is perhaps the most aggressive market positioning strategy of all and actively sees the brand compare itself to competitors, highlighting the reasons why they are the best.

Any brand using “better than the market leader” as a tool falls into this category.

Why Marketing Positioning Matters

The fundamental features of competitive positioning processes in marketing revolve around the idea of finding where the brand belongs. Whether you’re a business owner or marketing decision-maker, it’s important to ask ‘why’ before developing a strategy. To get this right, you must learn to consider the matter from the client’s perspective as well as your own.

The role of marketing positioning for the brand

Marketing positioning serves many purposes for the company and can become a major driving force in marketing strategies and wider business matters. Some of the most influential rewards are that successful marketing will:

  • Help establish your place in the market and pinpoint the target audience that is most likely to generate conversions,
  • Allow you to maintain a consistent and transparent approach to marketing and related business matters,
  • Encourage you to establish a suitable pricing point for all products based upon your audience and brand image,
  • Promote a sense of resonation with existing and prospective customers to gain increased conversions and loyalty,
  • Reduce financial waste by focusing your endeavours on the right audiences and most effective marketing tactics,
  • Create a far better environment for analysing the success of existing strategies to boost your hopes of maximum engagement.

The benefits will naturally support employers, employees, and all partnered companies alike. 

The role of marketing positioning for the customer

Modern consumers are extremely interested in getting to know the brand behind the products and will instantly form judgments regarding brand positioning, even when it’s on a subconscious level. Competitive positioning as a marketing strategy is vital for many reasons, including:

  • Consumers can instantly tell whether the brands status and pricing model will be suited to their budget,
  • Consumers save time by heading straight to the area of the marketplace that is most likely to provide the goods they want,
  • Consumers that won’t be interested in using the company due to a conflict of morals can avoid brands altogether,
  • Consumers can begin to build strong relationships with the right brands with immediate impacts,
  • Consumers are in a better position to gain the emotional reaction they crave from purchases – whether it be a bargain or luxury buy,
  • Consumers will know which brands to listen to in regards to industry commentaries and content.

For the consumer, it’s hard not to judge a book by its cover, especially when they interact with so many different brands each day. Marketing positioning is, therefore, a key feature.

Examples Of Competitive Positioning In Action

Brand positioning has an influence on our opinions of brands every single day, including those that we don’t purchase from. Even when we don’t consciously think about those interactions, the power of the brand positioning on perceptions of the companies is huge. As these three examples show:


Apple is the perfect example of a company that positions itself as an innovative brand that focuses on product benefits. From iPhones to iMacs, the new features are heavily promoted with every release, along with the details on how their products add value to your life through convenience and added capabilities.

The tech giant also positions itself as a luxury brand, although goods are still aimed at the masses.


When you think of McDonald’s, you think of affordable, fast food. McDonald’s positions itself as a cheap treat, offering a more affordable solution to Five Guys and other alternatives on the market. While the taste is obviously a selling point, the low price and speedy service are critical parts of the brand’s position.

McDonald’s has had this brand positioning for generations, highlighting how effective good market positions can be.


Mercedes-Benz promotes itself as a luxury brand that cannot be afforded by most people. The classic “Lord, won’t you buy me” adverts of the 1990s capture those feelings to perfection. To this day, their products focus on the luxury and sense of exclusivity offered to drivers.

The car brand has, therefore, become a major hit with motorists that need vehicles for business matters.

How To Build A Competitive Positioning, Marketing Strategy 

Appreciating the incentives for a strong marketing positioning strategy is one thing, but doing it is another altogether. While a lot of work is required in each stage of the process, the plan of action is fairly easy to understand. 

  • Step One – Compare your company to its competitors, focusing on your contrasts and strengths to identify opportunities for securing a better place in the market.
  • Step Two – Establish a deeper understanding of your current positioning (even if it’s N/A) before detailing the benefits of the new market position you wish to achieve.
  • Step Three – Analyse the marketplace to discover how the market positioning of your competitors could influence perceptions of your brand,
  • Step Four – Develop a strategy based upon the findings of the above steps to ensure you reach the desired position while also creating the biggest impact.

A variety of research tools can be used throughout the different stages, while the development of a new strategy can involve changes to many aspects of branding and marketing. Complete all four stages, though, and you will gain a defined place in the market.

Marketing Repositioning

Market positioning isn’t only for new companies. There are many reasons why a business may wish to rebrand itself in order to reignite sales. Two of the most common incentives for rebranding are:

  • Poor sales figures because products are aimed at the wrong audience and/or have priced consumers out of making a purchase despite the obvious product quality,
  • Changes are needed to packaging, pricing, or product quality, but the company wants to maintain the leverage gained from its strong brand awareness.

In relation to pricing, this could see a company change its status as a luxury brand to becoming a more accessible solution. Car manufacturers and tech companies often fall into this category due to evolutions in the market. As for rebranding while maintaining brand awareness, Coca-Cola’s rebranding of products over the years includes examples o how it should be done, as well as how it shouldn’t.

Marketing repositioning sets out to change perceptions of a brand to ensure that it attracts the right type of client. When done correctly, it can transform a company’s fortunes.

Master Your Marketing Positioning Endeavours Today!

The impact of successful marketing positioning or repositioning strategies is huge, potentially transforming the future of your company’s brand identity, pricing tactics, and choice of ad campaign priorities. It can become the perfect platform to build upon.

With so much riding on the decisions made in this arena, teaming up with an experienced and highly professional marketing agency could be a key step to creating the engaging brand image you crave. Connect to a marketplace of experts today by contacting one of our advisors.

Work with the Best Agencies
Looking for a marketing agency? Sortlist has the largest agency database in the world. Since Sortlist was founded more than 5 years ago, we have analysed more than 50,000 agencies around the world to make it easier for you. Here are some of the cities in the UK that Sortlist is covering:

Isle of Wight


Access our exclusive content!